Why is IKEA so successful?

Rhodes Shopping Centre

IKEA is known the world over for its creativity and innovation which nails the home furnishings market right on the head. Not only does it give customers what they want, it creates demand which customers did not even know existed until they wander around in an IKEA store.

Its legendary reputation of having built a global business empire on the concept of an Allen key has been so successful because it  involved cost efficient and price competitive “flat pack furniture” which are mostly assembled by the customer.

However, the “success behind the success” that not many are aware of is that IKEA derives most of its success in the careful planning and construction of its so called “superstores” – gigantic retail outlets which offer 30,000 square metres of shopping space to capture the retail dollar. These superstores are twice the size of their predecessors to maximise economies of scale.

The location of these stores are of paramount importance ~ detailed research and analysis have been undertaken to ensure IKEA‘s new superstores are located in the fastest growing areas and suburbs of metropolitan cities around the world.

The IKEA superstore at 1 Oulton Avenue in Rhodes is one of its largest in the southern hemisphere. Business at this store has been thriving as a result of being located in the fastest growing precinct in metropolitan Sydneythe inner west area of Canada Bay. Being in the home furnishing and lifestyle business, IKEA envision this new growth and hence, the Rhodes superstore was born.

The City of Canada Bay includes the suburbs of Abbotsford, Breakfast Point, Cabarita, Canada Bay, Chiswick, Concord, Concord West, Drummoyne, Five Dock, Liberty Grove, Mortlake, North Strathfield, Rhodes, Rodd Point, Russell Lea, Strathfield and Wareemba. In recent years, there has been massive real estate development and growth in these suburbs which surrounds the western fringe of the Sydney CBD.

Not to be outdone by the Rhodes superstore, the proposed new superstore in Tempe, a suburb to the south of Sydney near the airport, will take over the mantle from Rhodes as being the largest IKEA store in Australia, featuring a total gross area of 39,000 sqm and 1,775 parking spaces. This store is scheduled to open for business in late 2011 and wil create up to 500 new job opportunities for local residents.

Jim Skinner, the CEO of McDonalds will readily concede the real strategy behind the success of  the fast-food chain is in the business of owning real estate in strategic locations rather than delivering great hamburgers. The location of each McDonalds’ outlet enables the delivery of an average hamburger in the most effective and efficient way.

The success of IKEA is founded upon pretty much the same formula.

IKEA store locations:

State Address Store

Opening Hours



Sydney 1 Oulton Avenue, Rhodes, NSW 2138 Mon – Fri 10am – 9pm
Sat – Sun 91m – 7pm
Mon – Fri 9.30am – 8.30pm
Sat – Sun 8.30am – 6.30pm
02 – 8002 0400
Melbourne Victoria Gardens Shopping Centre, Cnr Victoria & Burnley streets, VIC 3121 Mon – Fri 10am – 9pm
Sat – Sun 91m – 7pm
Mon – Fri 9.30am – 8.30pm
Sat – Sun 8.30am – 6.30pm
03 – 8416 5000
Brisbane 3539 – 3565 Pacific Highway Slacks Creek QLD 4127 Mon – Wed,  Fri 9.30am – 7.00pm
Thurs 9.30am – 9pm
Sat – Sun 8.30am – 5.00pm
Mon – Wed,  Fri 9.30am – 6.30pm
Thurs 9.30am – 8.30pm
Sat – Sun 8.30am – 4.30pm
07 – 3380 6800
Tempe 630 – 726 Prices Highway, Tempe, NSW 2044 Opening in late 2011 Opening in late 2011

Related stories:

Related Posts Plugin for WordPress, Blogger...
0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply